President of Pharmalogical and Medical Device King Sentenced to 5 Years in Prison for Sales of Counterfeit Drugs

July 5, 2016

Update:On December 13, 2017, the U.S. Court of Appeals for the Second Circuit vacated William Scully's conviction because a lower court "declined to allow Scully to introduce evidence at his 2015 trial showing he sought legal advice about importing drugs with foreign labels from one of his lawyers." Ultimately Scully pleaded guilty to one charge of introducing misbranded drugs into interstate commerce, and received a sentence of 32 months. An August 17, 2016 forfeiture order of $889,875 remained the same.

In 2014, the Department of Justice broke up one of the largest wholesale counterfeit drug operations in the United States. Medical Device King specialized in IV oncology medications, including some cold chain chemotherapy products designed for treating cancer patients. Owner William Scully imported fakes into the United States from criminals in foreign countries, and then sold them to medical practices, while claiming the drugs were genuine and FDA-approved.

William Scully, President of Pharmalogical, Medical Device King, and Taranis Medical Corp, has been sentenced to 5 years in prison and ordered to forfeit nearly $900,000 in ill-gotten gains, reports the Department of Justice (DOJ). Two years earlier Scully was convicted of 64 charges ranging from wire and mail fraud, to violations of the Food, Drug & Cosmetic Act, unlicensed prescription drug wholesaling, and conspiracy.

According to the DOJ, Scully’s convictions were the result of his “leadership role in a long-running scheme to sell misbranded and unapproved pharmaceutical products, including chemotherapy drugs for infusion into Stage 4 cancer patients, to medical providers across the United States. Evidence elicited at trial from 40 witnesses established that Scully deceived a wide array of doctors and cancer clinics into believing that he was selling legitimate FDA-approved products when, in reality, he was selling unapproved products imported through a series of unidentified middlemen in Turkey and elsewhere overseas. Some of the products Scully sold were highly sensitive, so-called 'cold-chain' biologic drugs that did not have FDA-required warnings of potentially deadly side effects.”

Scully was the owner and operator of Pharmalogical, MDK, and Taranis. All together, these three wholesale companies sold more than $17 million in “bait-and-switch” transactions, where Scully would advertise to medical practitioners that he was offering FDA-approved medication, then would send out instead misbranded & non-FDA approved drugs, which in several cases turned out to be counterfeit, the DOJ reports.

This case was prosecuted by Assistant United States Attorneys Charles P. Kelly and Kenneth M. Abell.